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EnergoCredit Project – Small hydro project Investment in hydro plant increases revenue by USD 1,6 M and pays back in less than five years The company owns a hydro plant that dates back to the 1940s and needs complete rehabilitation. The existing plant has two sets of turbines, each producing 2.4 MW and needs a complete rehabilitation of the turbines and electrical equipment. In an innovative move they have decided to further expand capacity by building a second plant in a cascade on the same irrigation channel, thus avoiding additional environmental impacts. It was concluded that the rehabilitation would result in a 150% increase in capacity over existing electricity generation. The second hydro plant will have slightly less capacity. Nonetheless, together the two projects will almost double the company’s overall electricity output. A further innovation is the use of Chinese produced turbines, which reduce the cost of the equipment by 50%. The company has been careful to choose experienced suppliers and ensure quality control. The bank requested that Energocredit have an international hydro expert to check the project assumptions. The resulting Project Assessment Report concluded that the USD 7 million and increase revenues by USD 1.5 million hence the full project will pay back in less than five years. The project has been approved.

Georgia

The Company Main activities

Hydro plant

Region

Georgia

Project Goal and Main Investments Project goals

 Increase production capacity  Increase the reliability of the power plant

Main investments

 Replace the old equipment in the power house  Using the tail water from the first power plant, introduce a stage II power plant to generate more energy from the same water, before returning it to the canal

Investment size

Approximately USD 7 million

Expected Results Operational results

 Production of 45 GWh/y additional electrical energy  Lower outage time due to fewer break downs  18,000 t/y of CO2 emissions avoided

Investment profitability

 Revenues increased by USD 1.6 M per annum  Payback period of 4.6 years  An IRR of around 18 % on the investment

For more information on how your company can receive financing for energy efficiency projects, visit www.energocredit.ge, or call +995 32 224962. The EnergoCredit assignment in funded by EBRD though grant funds by: United Kingdom Sustainable Energy Initiatives Funds, Canadian International Development Agency, EBRD-Special Shareholders Fund and Early Transition Countries Funds


Case-Study-Alazani